Search

To link to full-text access for this article, visit this link: http://dx.doi.org/10.1016/j.eeh.2006.04.002 Byline: David S. Jacks Keywords: Futures markets; Commodity markets; Commodity price volatility; Speculation Abstract: In this paper, the divergence between popular and professional opinion on speculation in general and futures markets in particular is explored. Along the way, a synopsis of prevailing popular attitudes on futures markets is presented, and an outline of a formal model of futures markets and its implications for commodity price volatility are sketched. The heart of the analysis is drawn from the historical record on the establishment and prohibition of futures markets. Briefly, the results presented in this paper strongly suggest that futures markets were associated with -- and most likely caused -- lower commodity price volatility. The paper concludes with a discussion of potential sources of popular antagonism against futures markets. Author Affiliation: Simon Fraser University, 8888 University Drive, Burnaby, BC, Canada V5A1S6 Article History: Received 26 August 2005 Article Note: (footnote) [star] The author thanks Chris Hanes, Tom Weiss, Jeffrey Williams, and participants at the All-UC Group in Economic History Conference on 'Agricultural Development in Economic History', the Canadian Network in Economic History April 2005 meetings, the NBER's 2005 Summer Institute on the Development of the American Economy, and the paper's referees. Any remaining errors are mine. The author also gratefully acknowledges research support from the Social Science and Humanities Research Council of Canada.

What precisely were the causes and consequences of the trade wars in the 1930s? Were there perhaps deeper forces at work in reorienting global trade prior to the outbreak of World War II? And what lessons may this particular historical episode provide for the present day? To answer these questions, we distinguish between long-run secular trends in the period from 1920 to 1939 related to the formation of trade blocs and short-run disruptions associated with the trade wars of the 1930s. We argue that the trade wars mainly served to intensify pre-existing efforts toward the formation of trade blocs which dated from at least 1920. More speculatively, we argue that the trade wars of the present day may serve a similar purpose as those in the 1930s, that is, the intensification of China- and US-centric trade blocs. [ABSTRACT FROM AUTHOR]

The degree of market integration in the North and Baltic Seas area is explored. The three means for assessing different facets of market integration are proposed and on the basis of these three tests, it is positively concluded that market integration was in effect throughout the region and time-period under consideration.